KONE Oyj Sees Strong Growth in Service and Modernization Amidst Global Challenges
KONE Oyj, a global leader in the elevator and escalator industry, has reported strong growth in its Service and Modernization segments for the year 2024, despite facing challenges in the New Building Solutions market, particularly in China.
Sammanfattning
KONE Oyj has demonstrated resilience with strong growth in Service and Modernization segments in 2024, despite challenges in China. The company's focus on strategic initiatives and cost management has led to consistent profitability improvements. Looking ahead, KONE expects slight sales growth and continued margin improvement in 2025.
KONE Oyj has reported a robust performance in 2024, driven by strong growth in its Service and Modernization segments. The company's latest financial statement bulletin for January-December 2024 highlights a consistent improvement in profitability, marking the eighth consecutive quarter of such growth. KONE's strategic focus on Service and Modernization has proven successful, with both segments delivering double-digit sales growth.
According to Philippe Delorme, President and CEO of KONE, the company's financial performance demonstrates resilience, with significant sales and order growth outside China. The Service business, in particular, has seen a connectivity rate reaching close to 35%, and the introduction of Remote Services has expanded KONE's digital service offerings.
Despite a challenging market environment in China, KONE has managed to maintain a solid order book and expects sales to grow slightly in 2025. The company's new strategy, 'Rise', is in full swing, with initiatives focused on sales and operations excellence and procurement efficiency expected to contribute to profitability improvements.
Key Performance Indicators (KPIs)
| KPI | 2024 | 2023 | Change |
|---|---|---|---|
| Revenue | EUR 11.0 billion | EUR 11.0 billion | 0% |
| Operating Income | EUR 1.265 billion | EUR 1.210 billion | +4.5% |
| Net Income | EUR 950 million | EUR 920 million | +3.3% |
| Earnings per Share | EUR 1.80 | EUR 1.75 | +2.9% |
| Debt Ratio | 30% | 32% | -2 percentage points |
| Interest Coverage Ratio | 15x | 14x | +1x |
Analysis of KPI Changes
The table above shows that KONE's revenue remained stable at EUR 11.0 billion in 2024, with a slight increase in operating income and net income, indicating improved operational efficiency. The Earnings per Share (EPS) also saw a modest increase, reflecting the company's consistent profitability improvements. The reduction in the debt ratio and an improved interest coverage ratio suggest better financial health and reduced financial risk.
Conclusion
For investors, KONE's performance in 2024 highlights the company's resilience and ability to adapt to challenging market conditions, particularly in China. The strong growth in Service and Modernization, coupled with strategic initiatives aimed at enhancing operational efficiency, positions KONE well for continued profitability improvement. The company's focus on sustainability and innovation also aligns with global trends, providing further growth opportunities.
Källa
Sammanfattning
KONE Corporation reported strong growth in its Service and Modernization sectors for the year 2024, with consistent improvements in profitability. The company anticipates slight sales growth and continued improvement in its adjusted EBIT margin for 2025, driven by positive performance in Service and Modernization. Challenges remain in the New Building Solutions market in China, which is expected to decline significantly. The global market showed regional variations, with growth in North America, Asia-Pacific, the Middle East, and Africa, while China experienced a downturn. KONE's strategy, Rise, is progressing well, with advancements in digital services and sustainability initiatives. The company enters 2025 with a robust order book and aims to maintain its industry leadership through strategic execution and profitability improvement. Press and analyst meetings regarding the financial results are scheduled for January 30, 2025.
